A: No, all markets are not the same. Here are a few questions to consider when comparing markets: Does the carrier offer first dollar defense? Do they offer defense inside or outside the limits? Do they cover temporary employees or 1099 independent contractors? How much experience or years have they been in the E&O market? Will they honor your current retroactive date?
An admitted insurance company has been approved by the State of Michigan and must comply with all state regulations regarding insurance, including filing their rates with the state. In the event that the insurance company fails financially, the state will step in to make payments on claims as necessary.
A non-admitted insurance company does not necessarily comply with state insurance regulations, and they have more pricing flexibility as they do not have to submit their rates to the state for review. If they become insolvent, there is no guarantee that your claims will be paid, even if your case is active at the time of the bankruptcy or financial failure. Also, if a non-admitted policyholder thinks his or her case was handled improperly, he or she cannot appeal to Michigan’s Department of Insurance and Financial Services.